Agency theory is predominantly concerned with:
A) Shareholders appointing agents to manage the business
B) Directors preparing contracts for various business functions
C) Managers appointing agents to carry out various business functions
D) Contractual relationships between shareholders and directors and managers

Question

Quizplus · Accepted Answer

Agency theory primarily focuses on the contractual relationships that exist between shareholders (principals) and directors/managers (agents), analyzing how these relationships can be organized to best serve the interests of shareholders while also considering the potential for conflicts of interest.

Agency Theory Is Predominantly Concerned With